World leaders have sanctioned the reforms to the International Monetary Fund (IMF) which will give emerging economies like Brazil, China and India greater clout, and hailed the Basel III accord that toughens rules on banks’ capital requirements. The G-20 countries, the world’s leading economies, have been meeting in Seoul, South Korea 11 and 12 November.
US concerns to limit trade surpluses to four percent of a country’s GDP were given short thrift in the face of stiff opposition from the world’s two major exporters, China and Germany. Instead, countries committed themselves to a study of “indicative guidelines” concerning trade imbalances. China has come under pressure from industrialized countries who say its currency is under-valued and favours its massive export sector.
The talks were overshadowed by the US Federal Reserve’s announcement a week ago that it would issue $600bn in currency in order to buy US Treasuries, a move widely seen as designed to weaken the US currency, which would cause an influx of speculative capital into emerging countries. The summit’s final declaration says that leaders would heed “market-based exchange rates” and resist the temptations of “competitive devaluation”. It also gives the nod to countries to put in place capital controls to counter capital inflows.
The leaders of the G-20 group of the world’s 20 most important economies, meeting in Pittsburgh, Pennsylvania, have said that the grouping will become the world’s foremost economic coordination body, the White House announced late 24 September. This is a recognition of the importance of emerging economic powers such as Brazil, China and India. The G-8 comprised only the world’s top industrialized nations. In Pittsburgh the US is urging that institutions like the World Bank and the International Monetary Fund (IMF) reflect the changing economic circumstances as well. South Korea will preside the next G-20 meeting. Los Angeles Times, New York Times
Not enough of this around, says ILO
Geneva, Switzerland (GenevaLunch) – Unemployement levels in G-20 countries would be between 29 and 43 percent higher without the economic stimulus packages put in place by most governments following the economic crisis unleashed by the fall of investment bank Lehman Brothers one year ago, the International Labour Organization (ILO) announced today 21 September. The ILO still foresees the number of unemployed globally at between 219 and 241 million people, an increase of between 39 and 61 million unemployed.
US President Barack Obama will hold separate meetings with Palestinian President Mahmoud Abbas and Israeli Prime Minister Benyamin Netanyahu in New York, USA, before meeting them together Tuesday 22 September, in an effort to jump-start talks that have stalled largely because of Palestinian intransigence in the face of continued Israeli settlements in the occupied West Bank and East Jerusalem.
None of the three sides expect much to come out of the meetings, say observers, who note that Obama is keen to have something to show leading up to the UN General Assembly meetings and the subsequent G-20 meetings in Pittsburgh, Pennsylvania. Al-Jazeera, Jerusalem Post, New York Times
Tower Office, head of the BIS in Basel, Switzerland
Basel, Switzerland (GenevaLunch) – Central bank heads from 27 leading countries meeting in Basel agreed Sunday to follow recommendations made Saturday 5 September by finance officials, who met in London, to impose tougher capital requirements on banks. The new measures are designed to avoid a repeat of the collapse of much of the global banking system at the end of 2008.
